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Cargo rail fined for market abuse

THE SUPREME Court has confirmed a decision by the Antitrust Office (PMÚ) to fine the state-owned freight rail company, Železničná Spoločnosť Cargo Slovakia, for abuse of its dominant market position. As a result, the company paid a fine of €2.489 million on March 22. The court’s ruling ended a case that had been dragging on for nearly six years, the SITA newswire wrote.

THE SUPREME Court has confirmed a decision by the Antitrust Office (PMÚ) to fine the state-owned freight rail company, Železničná Spoločnosť Cargo Slovakia, for abuse of its dominant market position. As a result, the company paid a fine of €2.489 million on March 22. The court’s ruling ended a case that had been dragging on for nearly six years, the SITA newswire wrote.

The PMÚ decided in July 2006 that the freight rail company Železničná Spoločnosť Bratislava – and its legal successor Železničná Spoločnosť Cargo Slovakia – had abused its dominant position in 2004-2005 and violated the law on protection of economic competition. The authority imposed a Sk75 million fine (€2.489 million) on the company.

The PMÚ argued that the conduct of Cargo forced cement producer Holcim (Slovensko) to terminate cooperation with the shipping companies LTE Logistik and Transport Slovakia. This occurred because Cargo withdrew from price-setting agreements it had struck with the two companies, which provided freight rail transport services to Holcim (Slovensko).

“As a result of this conduct, LTE was excluded from the relevant market of transporting bulk cement on the line between Rohožník and Devínska Nová Ves, on the state border,” the antitrust office explained.

Cargo had acted in this way because Holcim had signed a direct contract on rail transport of bulk cement with LTE, a rival of Cargo, SITA reported. Previously, Cargo itself provided this service to the construction materials producer through a forwarding company.

After the Agriculture Ministry lifted its embargo, it turned out that the companies of Italians suspected of ties with ’Ndrangheta received subsidies worth millions of euros, through the Agricultural Paying Agency.